Bitcoin Halving which is predicted to occur on May 12, 2020, is the moment that Bitcoin investors being waited for. Why? Previously, this event has happened twice, first on November 28, 2012, and the second one on July 9, 2016, and this phenomenon has always caused soaring prices of Bitcoin to reach a price point that has never been reached before. But what exactly happened in this phenomenon?
What is Bitcoin Halving?
Basically, Bitcoin Halving is a reduction in the amount of Bitcoin that is awarded to miners who have processed transactions called “Blocks”. Because Bitcoin has a decentralized nature which means there is no authority to control its supply. However, the creator of Bitcoin makes the process of mining Bitcoin similar to gold mining, with the assumption that the amount that can be mined is limited, so the amount of available supply decreases over time.
Halving itself is a rule that has been installed in the code when an exact number of blocks that have been successfully excavated by miners has been reached, the reward that will be given to miners will be reduced by half compared to their reward before Halving. Expected that the price of Bitcoin will increase due to the depletion of available supplies.
When will Bitcoin halving occur?
As we know, that the estimation of the next Bitcoin Halving will occur on May 12, 2020. This is determined by the number of “blocks” that have been successfully mined by Bitcoin miners. This event occurs every 210,000 blocks that are successfully mined which takes approximately 4 years to complete.
What could we expect from Bitcoin halving?
Learning from the previous Bitcoin Halving, this phenomenon always causes an increase in the price of Bitcoin to a point that has never been reached before. When the first Halving took place in November 2012, Bitcoin experienced an increase in price from $ 11 to $ 1,000, although this increase only occurred a year later.
Then in the second one, in July 2016, the price of Bitcoin soared from $ 700 to $ 20,000 which also happened a year later.
From the two previous events, we can conclude that although the number of Bitcoin supplies is getting thinner, the demand for Bitcoin does not decrease, causing prices to soar.
Many assume that in this third Halving the same thing will happen, even according to Tim Draper, an entrepreneur who managed to generate billions from Bitcoin, in his interview with BlockTV stated that this third Bitcoin Halving could cause the price of Bitcoin to soar to $ 250,000 and will become the most significant increase in the price of Bitcoin in history. Tim also added that this increase would last for 6 months to a year after Halving.
So, what should I do now?
For those of you who are interested, this is the right moment for you to buy Bitcoin. In theory, you should buy Bitcoin now before the circulating Bitcoin decrease by half the amount after Halving.